FCC EXPLORES REGULATORY FORBEARANCE FOR NEW CABLE SERVICES
FCC is seriously looking into idea of adopting period of regulatory forbearance or creating “safe harbor” for new, cable- related technologies. Departing Cable Bureau Chief Deborah Lathen told us her staff had done “some additional work” on proposal “at the chairman’s request” after she floated general concept at Commission’s Feb. meeting (CD Feb 23 p2). “We've been doing work on forbearance,” she said in interview between clearing out her 3rd floor office at agency hq Wed. “This is food for thought.”
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Lathen, who marks her last day at agency today (Fri.) after 3-year stint, declined to spell out many details of proposal drafted for FCC Chmn. Powell. But one possibility, she said, is that Commission could seek forbearance authority for cable services under Title VI of Telecom Act, similar to its existing forbearance powers under Title II for telecom services. “Title VI does not have a forbearance section like Title II,” she said. “Maybe we should ask Congress for a similar provision for Title VI services.”
Another option, Lathen said, is for FCC to urge Congress to create “general safe harbor” protections for new or advanced video technologies that “don’t fit” into existing regulatory “boxes.” Under that plan, Commission could choose to refrain from regulating nascent services at least until robust market for them developed. She said that route could spur innovation and allow more consumers to sample new services earlier. “The regulatory structure is one of stovepipes,” she said. “But with convergence, that’s not the way the world is moving.”
Not surprisingly given that stance, Lathen said she opposed idea of FCC’s imposing open access and interactive TV (ITV) mandates on cable operators. Despite Commission’s current inquiries on both subjects, she sees no need to change federal policy and to regulate either emerging cable high-speed data market or ITV services. With several major MSOs now testing multiple ISP access on their cable systems, she said she expected marketplace to “take care” of open access issue. As for ITV issue, she said, “it is something worthy of watching but it’s not necessary for action at this time.”
Lathen also said she saw no need to reverse FCC’s laissez- faire policy on digital must-carry. Saying that Commission tentatively concluded in Jan. that mandatory dual carriage of analog and digital broadcast signals during DTV transition would infringe too much on cable operators’ First Amendment rights, she said “nothing’s changed” since then. She also said that Powell and former FCC Chmn. William Kennard held same position on issue. “The burden is on the broadcasters to say why they should get this extra space,” she said. “We've said all along that the case does not look good for broadcasters.”
Lathen said she did see need to retain some type of cable vertical ownership limit, despite recent ruling by U.S. Appeals Court, D.C., striking down current 30% cap as unconstitutional. She said Cable Bureau and agency’s chief economist were drafting report on ownership rules for commissioners, which should lead to notice of proposed rulemaking this summer. “I think we need to have a cap,” she said, without setting percentage. “What the right number is, I don’t know. The difficulty lies in coming up with a rationale for the cap that the court will support.”
With change in or possible lifting of ownership cap, Lathen suggested that policymakers look closely at retaining program access rules, now scheduled to expire next year. Cable operators already have started lobbying lawmakers and regulators for elimination of rules, arguing that they have fulfilled their purpose and have outlived their usefulness. But Lathen suggested that program access rules might be even more necessary in consolidated market of fewer, larger MSOs. “If we're going to change the ownership structure,” she said, “we've got to examine the program access rules in that context.”
Lathen, who had “pleasant and cordial” transition lunch Tues. with her successor, Kenneth Ferree, said she knew nothing about supposed proposal to form much larger TV division by combining shrinking Cable Bureau with Mass Media Bureau and satellite unit of International Bureau. Calling Powell “a very methodical and logical person,” she said any such restructuring “wouldn’t be done in a vacuum.” Powell is “very concerned about organization,” she said. “I'm sure he’s going to look at the organization in its entirety.”
As for her own plans after leaving FCC, Lathen said she aimed to return to private sector and work somewhere in communications industry, preferably in Washington, Cal. or Paris. But she said she really didn’t know where she was heading yet. “This is sort of a blessing,” she said, noting that she has been “working straight” for last 25 years. “I get to take a break and reflect.”